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HOLLAND — Striking a balance between keeping residential neighborhoods from becoming commercial hubs while still letting people to run a home business is the gist of an effort to re-write a Holland city ordinance.

On the table is a draft proposal that would create three tiers of home-based businesses depending on their level of activity, including allowing businesses that are “virtually invisible” to operate without a permit. For the first time, home-based business owners operating in the city could have employees in their home and conduct activities outside in yards.

The goal is to streamline the permit process and continue to allow people to start and run a business from their home, yet avoid any disturbance to the surrounding residential neighborhood through increased traffic or noise.

“We don’t want any additional impact on the neighborhood, but by the same token we want people to be as productive as they can,” city planner Mark VanderPloeg said. “We’re hoping for a lot of things where they can just do it without having to come in and get a permit or go through a hearing. What’s the sense of doing that?”

Fueling the ordinance re-write is the growing number of people who either work or operate a small business form their home.

In one small indication of the trend, the number of Holland residents who reported working at home increased 267 percent between 1980 and 2000, according to the U.S. Census, from 113 to 405.

And VanderPloeg believes the Census data shows just the “tip of an iceberg” of the actual number.

VanderPloeg expects a draft ordinance to come up for a public hearing in early April.

Attaining a balance between allowing people to operate a small business at home with avoiding problems for the neighborhood makes sense to the Holland Area Chamber of Commerce. Home-based businesses are a growing element of economic growth and chamber President Chris Byrnes doesn’t want to see any regulations that would stifle that growth or hinder the ability of people to work or run a business from home.

“That’s a way many, many of them get started,” said Byrnes, noting the exceptional examples of two corporate icons in Holland that started in their founders’ homes: Haworth Inc. and the former Prince Corp.

“That’s part of our history and success here economically, so we have to be careful that we don’t over-regulate,” Byrnes said. “That’s part of allowing our economy to grow.”

The Holland Area Chamber of Commerce has yet to offer a position on the city’s ordinance re-write, although its Small Business Committee plans to review the proposal, Byrnes said.

“We hope to be able to participate in that,” he said.

As drafted, the ordinance re-write would allow people running a home-based business to operate essentially unregulated as long as it is “virtually invisible” and does not have any impact on the surrounding neighborhood.

A second tier of home-based businesses that’s “a little more intensive” would have to secure a permit from the city zoning administrator if it has “measurable” impacts on the neighborhood, such as a handful of clients coming and going during the day, VanderPloeg said. These could include professional services such as accountants who work from their home.

The third tier would require a home-based business to obtain a permit from the city’s Zoning Board of Appeals following a public hearing if the owner conducts any business activities outside of the home and has an employee working there. The draft, written to update an existing ordinance that’s more than 20 years old, would allow home-based businesses to have one employee on the premises at a time.

The draft ordinance also would set hours of operation for a home-based business at 7 a.m. to 9 p.m.

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